Dollar gains against sterling on Brexit worries, U.S. growth bets

NEW YORK – The U.S. dollar hit its highest level in two months against the sterling on Wednesday on concerns over next year’s Brexit negotiations, while expectations of higher U.S. economic growth also underpinned the greenback.

Sterling fell as much as 0.5 percent to a session low of $1.2201, its weakest since Oct. 31. Britain faces uncertainty next year over Brexit negotiations. In October, Prime Minister Theresa May said she would trigger the process to leave the European Union by the end of March.

Expectations that U.S. President-elect Donald Trump’s incoming administration would boost U.S. growth through fiscal stimulus also continued to bolster the dollar.

Trump plans to make an announcement related to the economy between 4 p.m. and 5 p.m. ET (2100 to 2200 GMT), incoming White House spokesman Sean Spicer told reporters on a conference call. [nL1N1EN0NE]

The dollar index, which measures the greenback against a basket of six major rivals, has gained 4.7 percent this year. All those gains have come after the Nov. 8 U.S. election.

The Federal Reserve’s projections, released on Dec. 14, of three rate hikes for 2017 from the two foreseen in September have also contributed to the dollar’s recent gains.

“This is just a continuation of the trend” of dollar strength, said Axel Merk, president and chief investment officer of Palo Alto, California-based Merk Investments. Merk, who noted that trading volumes were thin with many traders on vacation, said the upcoming Brexit talks did not bode well for sterling.

The euro fell as much as 0.8 percent against the dollar to an eight-day low of $1.0372. Against the Japanese currency, the dollar was last down 0.15 percent at 117.21 yen, slipping from an earlier six-day high of 117.81.

The dollar index .DXY was last up 0.28 percent at 103.310 after hitting a session high of 103.630 and flirting with a 14-year peak of 103.650 struck on Dec. 20.

Some analysts said another source of euro weakness was the rise in the European Central Bank’s estimates of how much additional capital will be needed to prop up Italian bank Monte dei Paschi di Siena.

“Our case is that there’s probably a bit more room for (the dollar) to run,” said Dominic Bunning, a strategist with HSBC in London.

The euro remained weak against the dollar even though contracts to buy previously owned U.S. homes fell in November to the lowest in nearly a year, according to National Association of Realtors data. – Reuters

Related Posts
ZSE closes weaker
HARARE-The equities market fell by a marginal 0,01 percent to close at 152.96 following today’s trades as volumes continue to be thin. African Sun slipped 7,41 percent to 2,5 cents, while ...
READ MORE
Mobile money growth threatens traditional banking, says Invictus Securities
HARARE– One of Zimbabwe’s leading advisory firms says robust growth in technology based payment platforms poses a serious threat to the earnings of already frail traditional banks. In the Banking Industry ...
READ MORE
CBZ Holdings seeks to grow income base, reports $5mln PAT in Q1
HARARE,– Zimbabwe’s largest local financial services group CBZ Holdings intends to increase contribution of its non-banking assets from 15 percent to 20 percent by the year 2019. Group chief executive Never ...
READ MORE
Rand, stocks weaker after Fed hawkish comment
Johannesburg — The rand retreated for a third consecutive session on Friday to its weakest level in a week against the dollar while stocks also fell, both assets pressured by ...
READ MORE
Rand hits record low, bank stocks dive after minister’s sacking
JOHANNESBURG (Reuters) - South Africa's rand weakened to a record low on Friday, slumping more than 3 percent in the wake of this week's sacking of the finance minister, while ...
READ MORE
There is still a market resistance to the use of bond coins almost two months after the Reserve Bank of Zimbabwe (RBZ) introduced them into the market. Accusations and counter accusations ...
READ MORE
Wall Street Journal report ranks Zimbabwe among most repressed economies, notes marginal gains
HARARE, – Zimbabwe is the most repressed economy in sub-Saharan Africa and in the bottom five worldwide – due to government intervention, policy inconsistency and corruption, according to the 2015 ...
READ MORE
Dollar gains, U.S. yields rise as investors await Fed
The dollar strengthened and U.S. Treasury yields hit a two-week high on Monday on expectations the Federal Reserve will give a signal this week that it is gearing up to ...
READ MORE
Harare bond notes stand in for dollars
ZIMBABWE will introduce bond notes and restrict foreign currency spending to vital commodities to limit dollars leaving the country and exacerbating the nation’s cash crunch, Finance Minister Patrick Chinamasa says. "We ...
READ MORE
Cash crunch temporary, bond notes “surrogate currency” – Mugabe
HARARE, – President Robert Mugabe says the cash crisis is “temporary” and that government will press on with the introduction of bond notes, which he called a “surrogate currency,” despite ...
READ MORE
ZSE closes weaker
Mobile money growth threatens traditional banking, says Invictus
CBZ Holdings seeks to grow income base, reports
Rand, stocks weaker after Fed hawkish comment
Rand hits record low, bank stocks dive after
Bond coins face resistance
Wall Street Journal report ranks Zimbabwe among most
Dollar gains, U.S. yields rise as investors await
Harare bond notes stand in for dollars
Cash crunch temporary, bond notes “surrogate currency” –

Arts & Entertainment

Arts & Entertainment

Recovering from memory loss, Kanye West focuses on fashion comeback

14th February 2017 Staff Reporter 0

NEW YORK – Two months after being hospitalized for exhaustion and still recovering from memory loss, Kanye West is expected to make his first major public appearance at New York Fashion Week, his producer revealed. West, […]